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As the financial world takes a more serious tone and as volatility continues to spike, an increasing number of investors may be looking to alternative places to put cash to work. While many of the usual names come to mind quickly such as gold, Bitcoin, and other cryptos, there may be an even safer place to put capital to work. Real interest rates, if they continue to rise, could become an increasingly important source of competition for gold and cryptos.

The gold market has recently found support at the $1800 level and the bears have, thus far, been unable to breach this key level on a closing basis. While this level may hold, for now anyway, it could come under increased attack in the months ahead as the Fed looks to raise interest rates aggressively. Although there have been some signs of a peak in inflation, the core rate of inflation is very likely to remain elevated through the course of the year. This elevated inflation could create a challenging environment for both the economy and markets and leave investors searching for asset classes that may protect their purchasing power.

Although the entire curve is not in positive territory, real yields could see a decent climb as the Fed looks to potentially raise rates to the 3% level in the months ahead. As nominal rates rise, real yields will also rise. As real yields climb, investors looking for perceived safe-haven assets could simply put money into a bond that would provide a good risk/reward scenario. The last few years have seen gold benefit due to negative real interest rates. As rates climb out of the gutter, however, they may pose a powerful threat to gold, Bitcoin, and other assets typically bought as safe-havens.

Of course, the Fed could change its mind or even reverse course completely. After saying for some time that inflation was only transitory, however, the Fed changing course is very unlikely. The central bank may, this time around, actually stick to what it has been saying for months now. If the Fed looks to get inflation under control, it will need to raise rates aggressively and the 3% level may not even be high enough. The Fed’s last meeting saw it hike rates by 50-basis points. That same move is likely to be seen at the next two or three consecutive meetings as the Fed looks to show it means business.

The primary competitor for gold has been cryptocurrencies. These assets have been hammered as of late, however, and do not seemingly pose much, if any, threat to gold in the current environment.

The gold market remains stuck between two key levels-$1800 and $1900. Whichever level breaks first, on a closing basis, may determine the way gold moves for the months ahead. The longer the market stays sideways between these levels, the greater the eventual breakout or breakdown may be.